Alternative payment system Dwolla announced on Friday it has partnered with a school district in Iowa to enable online payments for school lunches.

After signing up for Dwolla, parents and guardians withchildren attending Iowa schools in the Beaman, Conrad, Liscomb, Union, and Whitten (BCLUW) district can pay for lunches online on a weekly, bimonthly, or monthly basis.

There is no transaction cost for parents, and because Dwolla only charges 25 cents for payments over $10, it can save schools a significant amount of money on credit and debit card fees.

According to the blog post, Dwolla is seeking additional partnerships with school districts.

To learn more about Dwolla, watch its FinovateSpring 2012 demo.